How To Be Wealthy, Not Rich

Being Wealthy Isn’t Just about Money

If you are wondering how to be wealthy, not rich, this post was made for you because I will show you the difference. While I will only cover being wealthy within the context of money, remember that wealth is about more than numbers.

Written By Tiffany Woodfield, Financial Coach, TEP®, CRPC®, CIM®

Is there a difference between being wealthy and being rich?

The difference between being rich and being wealthy is perception.  

Rich is what you see, and wealth is what is in your bank account. Rich people tend to be more “in-your-face,” trying to keep up with their neighbours and always looking to show off the fact that they just purchased the latest “toy.”  However, wealthy people tend to be more understated and focused on the long term, making smart decisions that align with their values. 

How can I be wealthy, not rich?

To be wealthy and not rich, you must first ask yourself these four questions:

1. What is most important to me?  
2. Why do I want to be wealthy?
3. What legacy do I want to leave?
4. What impact do I want to have? 

You need to focus on what makes you happy and fulfilled rather than what others think of you.  

Rich people are externally motivated to seek others’ approval and recognition to achieve a certain status.  The problem is no amount of external validation will fill an internal void.  

Social media can be a perfect example of the difference between rich and wealthy.  When you post because you need to show the world how happy and great your life is; this is similar to “rich” behaviour.  Being wealthy means not needing to post and knowing you have a happy life.  I’m not saying everyone who posts on social media or has a fancy car is frivolous and externally motivated.  Instead, I’m suggesting that you ask yourself why you are posting or purchasing the item.  Is it because you want others’ approval or because you genuinely like something and think it is important?   

Can you be wealthy without being rich?

Yes, to be wealthy without being rich is all in your attitude.  

Suppose you’ve spent time with rich or aspiring-to-be-rich people or attended social gatherings where someone is going on and on about their place in Aspen, a trip around the world, or an expensive purchase.  While most people listening are rolling their eyes, some think, “Wow, they must be rich!”  

If you can stand there and listen to this without competing on everything you have, being comfortable with nobody knowing your financial status, you may be considered wealthy.  It is the quiet confidence.

You are internally motivated and in alignment with your core values. 

What is considered “rich” in Canada and the US?

Different statistics can classify you as rich in Canada or the US.  

In most countries, to be in the top 1% of income earners is considered rich.  So, what does this actually mean in terms of income?

In the US, if you want to be in the top 1%, you need to earn over $800,000 (as of 2019). Meanwhile, in Canada, you would need an income of $512,000 (according to Stats Canada in 2023) to be in the top 1% of earners. 

Of course, what makes you “rich” really depends on more than a number, and you need to consider your lifestyle, attitude, where you live, and your level of assets. 

How can I achieve financial independence to become truly wealthy?

To achieve financial independence and become truly wealthy, you need to follow these logical steps:

1. Determine your values and create a financial goal based on these values.
2. Look at your current financial situation and create a budget.
3. Track your expenses and income.
4. Educate yourself on the basics of investing and finances. 
5. Follow a plan to pay off high-interest debt and start saving.
6. Be accountable and consistent.

The two most important keys to financial freedom are being aware of your spending habits and being committed to making changes that will move you toward your goals.  This may mean forgoing some things today so you have more in the future. 

How does maintaining good health contribute to being wealthy?

To be successful in life, you need to maintain good health. 

Taking care of your mind and body is essential. If you’re sick, you cannot work, and large medical bills can impact your wealth significantly.  However, you also need to consider that being wealthy is about more than a dollar amount. It is about enjoying the freedom you have worked so hard to create.  Maintaining good health doesn’t need to be difficult. Be mindful about what you eat, prioritize sleep, and add walking to your routine. 

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